Those who think that if Ethereum and Bitcoin are cryptocurrencies, they should have similar uses are deeply mistaken. Bitcoin is digital gold, and Ethereum is a multi-faceted platform.
The main differences between Bitcoin and Ethereum
These coins are the largest cryptocurrencies, but if you take a closer look at them, it becomes clear that they have completely different goals. There are several major differences between Bitcoin and Ethereum that anyone interested in the financial market, especially in the crypto industry, should be aware of.
First, Bitcoin is a cryptocurrency, unlike Ethereum, which is used as a platform. Secondly, in each case, there is a difference between the transaction methods: if Bitcoin transactions occur in monetary terms, transactions with Ethereum can be executable instructions. And, last but not least, the BTC is a mean of saving and exchanging, while the ETH is not.
Bitcoin was developed by a mysterious figure known as Satoshi Nakamoto, who wanted to create a peer-to-peer electronic money system operating without a central authority. This is often referred to as the idea of money without any physical form, giving an alternative to the use of traditional fiat currencies that were supported or imposed by different countries.
However, Ethereum is more than just a cryptocurrency, and it was launched in 2015. The blockchain on which Ethereum is based can be used for various purposes, such as paying for computing services on the blockchain. It is a programming language and a decentralized software platform. The program automatically performs actions that do not require the participation of intermediaries, and concludes agreements between several parties.
The system is unique in that it enables many industries to use this platform to their advantage. For example, it changed the gaming industry and the entertainment industry in general, giving many gaming companies the opportunity to implement video games in the crypto industry.
Decentralization also creates the possibility of using Ethereum for online gambling. This is very convenient for those involved in this area to enjoy the process without worrying about security issues, as it guarantees the anonymity of the process and makes it even more convenient and efficient during gameplay.
Comparison of BTC and ETH
The accounts of the total market capitalization of all cryptocurrencies are divided between Bitcoin and Ethereum by 72% and 15%, respectively.
Bitcoin is designed to help people transfer their valuables from one account to another without a complex banking system, and is seen as a means of saving. In total, there are almost two million coins left to mine.
Unlike the BTC, the Ether has no hard limit. The main advantage of Ethereum is that it is built on the idea of a universal multi-purpose blockchain. As a result, Ethereum can perform many tasks well, and not just serve as a payment system. Ether can be used as a digital currency, but this is not its main purpose. The platform was created primarily to monetize transactions with Ethereum smart contracts and decentralized applications.
Finally, to sum up, there are many reasons that confirm that, in general, Ethereum is superior to Bitcoin. Although the price of Bitcoin is several times higher than that of Ethereum, this does not mean that it has more advantages.
The main value of Ethereum is its ability to use it in different ways, and not just as a payment system or transaction execution. Ethereum is an entire system or software that gives the industry many opportunities that were previously impossible. This has already changed the usual view of many everyday things, and it is expected that this influence will spread to many other areas. It’s only a matter of time.